House Hunting in ... Puerto Rico

Slide Show | A Pueblo-Style House between Ocean and Rain Forest This four-bedroom, three-bath house, on Puerto Rico’s northeast coast, is on the market for $1,200,000.

Dennis M. Rivera Pichardo for The New York Times

March 16, 2016

International Real Estate

By ROXANA POPESCU

A PUEBLO-STYLE HOME BETWEEN OCEAN AND RAIN FOREST

$1,200,000

This four-bedroom three-bath house in the city of Luquillo has an unusual look for Puerto Rico: It is designed in the Pueblo Revival style typically found in the Southwestern United States.

“I wanted to build something unique,” said Rosa Jusino, the seller, who is a real estate lawyer with a love of horses and historic architecture.

The villa, named Rancho Soberano, or Sovereign Ranch, sits at the end of a long, tree-lined driveway. The front of the house faces El Yunque rain forest, and the back faces the Atlantic Ocean. The front doors, which have quaint adornments including a lookout window, lead to a foyer. Just past it is the living room, which has 15-foot ceilings and a rounded kiva fireplace. It may seem unusual to have a fireplace on a tropical island, Ms. Jusino said, but lighting a fire or heating up bread there feels homey.

The open kitchen, which includes a dining area, is to the right of the living room. On the other side of the house, to the left of the living room, are three bedrooms, including the master, which has an en-suite bath. It also has a rounded wall with windows that overlook the yard and the ocean in the distance. Two other bedrooms next to it share a hall bath. The fourth bedroom has an en-suite, wheelchair-accessible bathroom, Ms. Jusino said.

Though the 3,000-square-foot house, built in 2009, looks as if it were made of adobe, the material is actually reinforced concrete with an antiqued finish. “It’s rustic, it’s simple, it’s in harmony with Earth,” Ms. Jusino said. She ordered Talavera and Saltillo tiles from Mexico and clay sconces from Texas. The custom carved wooden corbels and wrought-iron gates came from local artisans. There are ceiling fans throughout, and three of the four bedrooms also have individual air-conditioning units.

The villa’s design lets nature in through its use of terraces and patios. A hallway from the living room leads to a semi-enclosed, open-air room facing the rain forest. Immediately outside the living room is a covered terrace with a hammock. The décor and furnishings, including many hand-painted pieces, are not included in the asking price but are negotiable separately.

The home is in the city of Luquillo, population 20,000, on the island’s scenic northeast coast, said Oriana Juvelier, a vice president of Puerto Rico Sotheby’s International Realty, which has the listing. The property, which has equestrian facilities that include three stables and four paddocks, sits on 4.1 acres on a hill about two miles from the ocean. It’s possible to ride horseback to the beach, Ms. Jusino said, and the rain forest is a short drive away. The airport is 25 minutes away, and Old San Juan is a 40-minute drive, Ms. Jusino said.

MARKET OVERVIEW

Real estate agents in Puerto Rico said the island’s economic crisis has led people to move away, creating bargains for buyers willing to make compromises on location. For prime properties near the water, however, where demand is enhanced by tax incentives created for wealthy foreign buyers, prices are stable or even rising.

“The fact that many professionals are leaving the island looking for better jobs in the U.S. and some of the local wealthiest people have been impacted negatively by losses in local investments in bonds creates some interesting opportunities to purchase luxury properties,” Hiram Albino, the founder of Luxury Estates Puerto Rico, an agency based in Dorado Beach, a resort community west of San Juan, wrote in an email.

Prices across the island have fallen by as much as 50 percent for the nonluxury market, as well as for high-end properties that are not on the beach, Mr. Albino said.

Ms. Juvelier said that “in actuality, it is the best time to buy here.”

Beachfront luxury homes have been spared from the fall, agents said. The supply of top-quality properties is limited, but demand is strong because of the tax incentives initiated in 2012. A law named Act 22, designed to entice investors and high-net-worth individuals to move to Puerto Rico, with incentives including tax exemptions, has resulted in almost 600 people moving to the island since 2012, said José Joaquín Villamil, an economist and chairman and chief executive of Estudios Técnicos, an economic consulting firm in San Juan, citing government figures.

“The real estate market is in shock,” Mr. Villamil said. “Obviously, one would expect it. What’s kept the high end of the market going is the Law 22.”

Mr. Albino said luxury properties in the high-demand areas of Condado and Dorado Beach reach $1,000 per square foot.

Leticia Brunet Gonzalez, the president of the Trillion Realty Group, a Christie’s affiliate, said prices of luxury homes near the water have remained stable, or in some cases increased, since 2012. Prices per square foot range from $400 to $600, and with few exceptions, properties tend to close at about 15 percent below asking, she said.

Ms. Brunet Gonzalez added that the approaching presidential election in the United States and the election for governor of Puerto Rico, also in November, were having an effect on the real estate market, as prospective buyers are anxious and hopeful about the outcomes.

WHO BUYS IN PUERTO RICO

Most luxury home buyers come from the United States mainland, agents said.

But Ms. Juvelier said that Iberia and Norwegian Air Shuttle have started offering direct flights, reflecting an increased interest from Europeans. Her agency has also had buyers in the last 16 months from United Arab Emirates, China and Canada, and inquiries from Japan. “That’s directly through tax incentives,” she said.

BUYING BASICS

United States citizens can buy property without restriction in Puerto Rico, which is a United States commonwealth. Transactions are handled by notaries, who are also licensed lawyers in Puerto Rico, said Thelma Rivera, a partner with Goldman Antonetti & Córdova, a San Juan-based law firm. That notary is typically chosen by the buyer, and the seller pays a notarial tariff.

Puerto Rico’s closing fees, including a stamp duty and the notarial tariff, are on a sliding scale. As an example, for a $1 million home costs would total around $10,600, Ms. Rivera said. Of that, the buyer would pay around $6,000.

She recommended that buyers get a real property tax debt certificate before closing. “Otherwise, a buyer is responsible for unpaid property taxes for the current and last five years if these have remained unpaid,” Ms. Rivera said.

Mr. Albino also advised buyers to request a title search and get a professional appraisal.